Cambodia halts rice exports to curb rising domestic prices

PHNOM PENH, Cambodia: Cambodia's prime minister ordered a ban Wednesday on rice exports to neighboring Thailand and Vietnam in a bid to curb rising domestic prices for the country's staple food.

Prime Minister Hun Sen said Cambodia is halting rice exports for two months to help "ensure the stability of the Cambodian market."

The measure is only temporary "to guarantee food security for Cambodia," he said in a speech at a ceremony marking the repair of a road.

Cambodia is a minor rice exporter, shipping about 450,000 tons of milled rice last year, according to a U.S. Department of Agriculture estimate. Neighboring Thailand, one of the world's top exporters, exported 8.5 million tons, it said in its "Rice Situation and Outlook Yearbook."

Hun Sen said all border agencies must begin implementing the order Thursday at all crossing points along the borders with Thailand and Vietnam. Because of the small-scale of production, most if not all exports would go overland to the two countries.

Since the end of the harvest early this year, farmers living in provinces bordering the two countries have been selling rice in large quantities across the borders, attracted by high prices, said Men Sarun, owner of Men Sarun-Import-Export Co.

He said a ton of rice now sells for about US$500 (€318), twice as much as last year.

The trend, while making some farmers happy about earning greater profits, could also result in food shortages in Cambodia later in the year, he said.

Hun Sen said the rising price of rice is a global problem.

In another speech Tuesday, he blamed "economic saboteurs" for causing the surge in domestic prices. It was not clear whom he was referring to.

Without imposing the ban, Cambodian rice will "keep flowing out, and they (the alleged saboteurs) will keep shaking up the price at home," he said Wednesday.

"So keep the rice here. No more export of it for two months after which the government will see how stable the market is," Hun Sen said.

The government will inject rice from its reserve into the market to help prevent further increase of the price, he said.

Cambodia produced an estimated 3.6 million tons of milled rice last year, according to Cambodian agriculture officials. About 2 million tons was estimated to be needed for domestic consumption this year, leaving a surplus of 1.5 million tons.